Nifty snaps six-day winning streak

Snapping six-session winning streak, domestic equity market -- Nifty -- finished lower on second day of the week, amid caution ahead of RBI’s monetary policy committee meeting outcome on November 5. Factors like depreciating rupee, rising crude prices and weak global cues too dampened sentiments. Nifty made a cautions start and soon extended the losses with CRISIL cutting India’s growth forecast for current fiscal to 7.4% on the back of weakening GDP growth and lower global trade forecasts. India’s growth in the July-September quarter slipped to 7.1% from 8.2% in the April-June quarter. Adding to pessimism, India’s export, which saw a revival in early part of 2018, could likely see a slower growth. Some concerns also came with ICRA’s statement that India’s current account deficit is likely to rise to 3% of GDP in the July-September quarter of current fiscal, from 2.4% in the preceding quarter, driven mainly by high crude oil prices.

Market pared most of its losses in the last leg of the trade, as investors opted to buy beaten down but fundamentally strong stocks. Though, anxiety remained among investors with a private report that the 50 percent rise in shadow-banking loans in October was on account of difficulties in arranging money from money market alternatives but is unlikely to sustain. Besides, a private report also stated that the 50 percent rise in shadow-banking loans in October was on account of difficulties in arranging money from money market alternatives but is unlikely to sustain.

Traders were seen piling up positions in IT, Media and Metal stocks, while selling was witnessed in PSU Bank, Fin Service and FMCG. The top gainers from the F&O segment were Equitas Holdings, Ujjivan Financial Services and Infibeam Avenues. On the other hand, the top losers were Adani Power, Apollo Hospitals Enterprise and DLF. In the index option segment, maximum OI continues to be seen in the 10,900-11,200 calls and 9900 -10,200 puts indicating this is the trading range expectation.

India Volatility Index (VIX), a gauge for market’s short term expectation of volatility decreased by 0.63% and reached 18.10. The 50-share Nifty was down by 14.25 points 0.13% to settle at 10,869.50.

Nifty December 2018 futures closed at 10907.75 on Tuesday, at a premium of 38.25 points over spot closing of 10869.50, while Nifty January 2019 futures ended at 10952.65, at a premium of 83.15 points over spot closing. Nifty December futures saw an addition of 0.24 million (mn) units, taking the total outstanding open interest (OI) to 20.07 mn units. The near month derivatives contract will expire on December 27, 2018.

From the most active contracts, Yes Bank December 2018 futures traded at a premium of 1.00 points at 176.95 compared with spot closing of 175.95. The numbers of contracts traded were 40,447.

Sun Pharmaceutical December 2018 futures traded at a premium of 2.15 points at 445.15 compared with spot closing of 443.00. The numbers of contracts traded were 37,939.

Indiabulls Housing Finance December 2018 futures traded at a premium of 1.85 points at 804.40 compared with spot closing of 802.55. The numbers of contracts traded were 32,594.

Reliance Industries December 2018 futures traded at a premium of 3.50 points at 1156.60 compared with spot closing of 1153.10. The numbers of contracts traded were 18,631.

Tata Consultancy Services December 2018 futures traded at a premium of 9.65 points at 2019.50 compared with spot closing of 2009.85. The numbers of contracts traded were 14,662.

Among Nifty calls, 11000 SP from the December month expiry was the most active call with an addition of 0.03 million open interests. Among Nifty puts, 10,800 SP from the December month expiry was the most active put with an addition of 0.28 million open interests. The maximum OI outstanding for Calls was at 11,000 SP (2.73mn) and that for Puts was at 10,000 SP (3.98mn). The respective Support and Resistance levels of Nifty are: Resistance 10,895.85 ---- Pivot Point 10,864.60 --- Support --- 10,838.25.

The Nifty Put Call Ratio (PCR) finally stood at 1.31 for December month contract. The top five scrips with highest PCR on OI were V-Guard Industries (7.35), Mangalore Refinery & Petrochemicals (1.91), Infosys (1.29), IDBI (1.24) and Adani Power (1.11).

Among most active underlying, Sun Pharmaceutical Industries witnessed an addition of 1.94 million units of Open Interest in the December month futures contract, followed by Reliance Industries witnessing a contraction of 0.10 million units of Open Interest in the December month contract, Yes Bank witnessed a contraction of 3.84 million units of Open Interest in the December month contract, ICICI Bank witnessed a contraction of 1.80 million units of Open Interest in the December month contract and Hindustan Unilever witnessed an addition of 0.29 million units of Open Interest in the December month future contract.